Mr. Speaker,

Honourable Members of Parliament of the Republic of Zimbabwe, I am pleased to present the Seventeenth State of the Nation Address to this august House.

Mr. Speaker, let me begin by once more congratulating and welcoming Amai Joyce Teurai Ropa Mujuru as the new and second Vice President of our country. She has made history as the country’s first ever lady incumbent to that post, giving further credence to Zimbabwe’s support for international instruments that seek greater recognition and opportunities for women. I hope this appointment will set the tone for other sectors in the country so that due recognition is continually given to our womenfolk.

Mr. Speaker, I address you against the happy background of the onset of our rain season that promises to bring us an abundant harvest, and with it, greater opportunities for us as individuals and as a Nation. As I address you, the countryside is abuzz, as men, women and children finish land preparations for a new cropping season. It is important that Government, alongside other sectors of the economy, ensures that our new farmer is accompanied all the way, getting as much support as we can muster.

In keeping with our tradition, we are going to hold our sixth parliamentary elections in March next year on a date to be announced in due course. This presents an opportunity to seek renewed mandates, depending of course on how well we served the people over the past five years. I want to reiterate Government’s determination that this impending poll should not be marred by incidents of violence from whatever quarter.

As Government has already indicated, the poll will only be conducted in terms of our national laws, with outside observers coming in strictly on the basis of invitation. I am happy that recent amendments to our electoral law have made us more than compliant with the standards and guidelines we developed, agreed to, and adopted, as SADC.

Mr. Speaker, we close the year on a high note as the economy is showing concrete signs of recovery. The foreign currency inflows continue to improve while its allocation to various sectors is determined through a veritable foreign currency auction system. From a paltry US$301 million 2003, the inflows have risen to US$ 1,6 billion as of two days ago, with encouraging signs of greater inflows arising from growing export capacity.

The exchange rate has largely stabilised, allowing for a predictable environment for business decision-making. Inflation, which was expected to reach four-figure digits, dropped from a record 622.2 per cent in January to 209 per cent as at the end of October, 2004. Gross Domestic Product (GDP), initially set to decline by 8.5 per cent in 2004, is now projected to decline by less than 5 per cent. These gains on inflation should translate into lower interest rates thus making investment finance more affordable. I urge our fiscal and monetary authorities to work even harder so that we can realistically target single digit inflation next year.

Notwithstanding these positive performance indicators, savings and investment, as a percentage of GDP remained below 5 per cent, but are projected to improve in the 2005 fiscal year. 

On balance, the economy has performed commendably, under adverse conditions of illegal sanctions, diminished official development assistance inflows and other forms of balance of payments support. We have relied on our own ingenuity and means, which are occasionally supplemented by genuine friends and allies. This experience has boosted belief in ourselves, and the years ahead should see us do much better. 

Mr. Speaker, the coming year should be one of investment, during which we should consolidate and grow our economy for more jobs and improved living conditions for our people. Foreigners only come to an economy which is driven by the confidence of its real owners. As the true owners of the Zimbabwean economy, we have to work singularly hard for its growth. 

I am happy that sanity is gradually returning to the financial sector, which should always render honest service to the economy. In an endeavour to purge the corruption scourge in the economy, the Bank Use, Promotion and Suppression of Money Laundering Act [Chapter 24:24] was promulgated and became effective from 1 September 2004. This piece of legislation empowers the State to investigate cases of money laundering and obligates financial institutions to immediately report such cases to responsible authorities. Other new complementary pieces of legislation include the Asset Management Act, the Financial Laws Amendment Act and the Securities Act that were passed by Parliament. 

We need to forge ahead in a purposeful way, targeting agriculture, mining, tourism and manufacturing as sectors of concentration in 2005. Government has already taken far-reaching measures to ensure this happens. Apart from restraining the fiscal appetite, it continues to pursue the dual interest rate policy, with concessional financing of up to 50 per cent being extended to the productive sector. A total of $2.9 trillion has been disbursed under the Productive Sector Facility since the beginning of this year. Agriculture, manufacturing and mining sectors received 57.1 per cent, 28,9 per cent and 5 per cent respectively, evoking a positive supply response as evidenced by increased capacity utilisation of above 50 per cent across all major productive sectors. A new policy framework and programme, “Zimbabwe: Towards Sustained Economic Growth— Macro-Economic Framework for 2005 — 2006”, a successor to the National Economic Revival Programme, and outlining the vision of our economic development programmes, will anchor all policy initiatives during the period 2005 — 2006. 

I have already adverted to agriculture as one of the lead sectors we must continue to support in a deliberate way, both for reasons of food security and for our overall export drive. The past two years have seen massive investments in the sector, a trend which is set to continue until we are satisfied that there is sufficient mechanisation to drive it, adequate infrastructure to support it, sound knowledge to guide it and good returns to expand it. Institutions in which Government has a stake, such as the Industrial Development Corporation, must take the lead as all the time they keep exploring and striking strategic partnerships with friendly foreign outfits for greater value addition in agriculture. Equally, our industrial research institutions should place their ingenuity at the service of this national cause so we can begin to incubate appropriate technologies for all forms of industrial application. 

Increased investment in crop production saw Government avail $215 billion for direct production costs of wheat, while $85 billion went towards an irrigation rehabilitation programme. This substantially increased the area under wheat from 42 000 hectares in 2003 to 70 100 hectares with a projected output of 280 000 tonnes. 

The tobacco-selling season opened on the 31^st March 2004 and closed on the 30^th September 2004. For the first time, “contract production and marketing” was introduced alongside the traditional “auction system”. Altogether, 15.6 million kilograms, or 22 per cent of total production of tobacco was sold through the contract scheme while the rest was sold through the auction system. 

To broaden indigenous participation in other forms of farming, Government has adopted a Wildlife Based Land Reform Policy to allow the majority of the people to participate in this lucrative sector, hitherto the preserve of a minority. Under the Policy, wildlife management will be treated as a business venture. Lease agreements in this sector have been limited to 25 years. 

Government is also working on the Forest Based Land Reform Policy aimed at promoting the sustainable exploitation of the country’s timber resources among the indigenous people. Other policies being developed include the Dairy Industry Policy aimed at resuscitating dairy farming through the development of the dairy herd, dairy production infrastructure and an appropriate market structure. 

Mr. Speaker, Government values the important role of biotechnology in agriculture, health and food processing, subject to ethical standards. To this end, a comprehensive national biotechnology policy has been developed while the Biotechnology Bill has been formulated to provide, in part, for the establishment of a National Biotechnology Authority. The Authority will have the power to manage the sustainable development and application of biotechnology, consistent with the provisions of the relevant multilateral protocols, which Zimbabwe has acceded to. 

The promotion of industrialisation is vital for the sustainable development of Zimbabwe’s economy. Consequently, Government has accordingly reviewed the present Industrial Development Policy with a view to transforming the country into an accomplished producer of processed value-added goods for both domestic and export consumers. To revive our industrial performance, Government has committed an initial $200 billion of concessional funding to the aid of distressed companies. 

Small to Medium Scale Enterprises (SMEs) are an integral part of the country’s industrial development. In this regard, the $3.5 billion SMEs Revolving Fund was fully disbursed to various sectors. The injection of $12 billion into SEDCO under the Productive Sector Fund from the Reserve Bank of Zimbabwe has visibly improved SEDCO’s capacity to deliver on its mandate, which was further strengthened by its participation in the disbursement of the Distressed Companies Fund. 

Mr. Speaker, production of all minerals continued to increase during the last twelve months in response to improved prices on the international market; increase in production at operating mines; re-opening of closed mines; and new investments. Our platinum mining activities should pull this sector to full recovery, as well as leading the way in terms of mineral processing. It baffles the mind that despite having the world’s second largest deposits of platinum, the country still does not have a platinum processing capacity. This is a capacity we are now planning to have. Mr. Speaker, Government expects Murowa Diamond Mine to begin production quite early in 2005. 

With an energy shortage projected, our mining development policy should coincide with our energy policy. We need greater activity both on the coal mining and on coal-bed methane gas deposits we know to exist in exploitable quantities. We need to augment our energy sources and ensure that new and pro-active partnerships supersede speculative or ornamental ones. Those foreigners intent on holding to our wealth embedded underground for speculative or other shady reasons must make way for others who mean serious business. 

Implementation of the rural electrification programme covered 2 732 projects as at the end of August 2004, while work in progress amounts to 1 197 projects. The Rural Electrification Agency is currently receiving material from China and India for the Expanded Rural Electrification Programme. Equipment from China comprises transformers, conductors and other electrical accessories, while that from India includes irrigation pumps, pipes, sprinklers and drip irrigation systems meant for the Zunde raMambo/Isiphala seNkosi Programme; new irrigation projects; and schemes to provide potable water in schools. 

Fuel supply in the country improved during the course of the year, partly due to the opening up of the sector and the availability of foreign currency. Although the oil industry established a Special Purpose Vehicle to further improve procurement efficiency, there is need to continuously rationalise this new mechanism in order to remove the bottlenecks that have resulted in intermittent shortages and shady conduct. 

The tourism sector is beginning to witness real and serious strides towards new directions and destinations. Signing of the Memorandum of Understanding on the prestigious Approved Destination Status with the People’s Republic of China complements the marketing thrust into new markets, especially the Far East. Although volumes are still low, compared to traditional markets, visitor arrivals from the Chinese market show a remarkable 245 per cent increase for the first half of 2004 compared to the same period last year. Arrivals from other Far East countries such as Malaysia and Japan have also shown an increase as have those from South America and the Caribbean Islands. Air Zimbabwe’s new route to the Far East should consolidate this new thrust which must be matched by new investments in facilities, including hotels. 

Mr. Speaker, to expedite infrastructure development, Government recently approved the Public-Private Sector Partnerships Guidelines, for the provision of infrastructure such as roads, dams, housing and other public services. The National Housing Delivery Programme which aims eventually to provide 1 250 000 residential stands was launched this year. At the end of June 2004, 184 762 residential stands, representing 85.6 per cent of the yearly target, had been allocated to individual beneficiaries, housing cooperatives and land developers. Further, joint venture projects to promote Public-Private Sector Partnerships which involve local authorities, financial institutions and land developers are being packaged and the response from all stakeholders has been encouraging. 

The National Road Network Development Plan has been put in place to speed up development of the rural road network as well as upgrade the regional trunk road network, while decongesting urban roads. The programme, to be implemented over five years, will be funded through the Public Sector Investment Programme and public-private sector participation. Bridges that were completed in 2004 include Manyame Bridge in Zvimba District and Moboyana Bridge in Matobo District. A number are under construction in various parts of the country. 

To transform Zimbabwe into a knowledge-based economy and bridge the digital and communication divide in its various manifestations, Government is developing a national Information Communications Technologies (ICTs) Policy to underpin the development and application of ICTs across all sectors of the economy. This includes the establishment of Government ICT infrastructure for Zimbabwe. Expansion of fixed and mobile telecommunications infrastructure, particularly in resettlement and remote rural areas, is being undertaken. Equally, Government will continue to mobilise more resources for the revamping and expansion of the broadcasting transmission network, as well as exploiting satellite technology in information diffusion. The Rural Information Kiosks mooted recently will be implemented in the corning year. 

I have pioneered a computerisation programme for high schools in the country. The initial phase of the programme targeted two rural schools in each province, each of which received a set of ten computers and two printers. I hope to embark on the second leg when more units have been sourced. It is vital that we upgrade the national education system to make it IT-conscious and compliant. Government as a whole will be formulating a programme for this schools computerisation programme to become more comprehensive. 

Mr. Speaker, in line with the SADC Protocol on Education and Training, the Ministry of Higher and Tertiary Education has undertaken to train teachers from other member countries. Currently, Belvedere and Mutare Teachers’ Colleges have enrolled student-teachers from Namibia to train in the areas of Science, Mathematics and Agriculture. 

The HIV and AIDS pandemic remains by far the biggest threat to the health of the population. It is estimated that by the end of the year, about 1 820 000 people will be living with HIV and AIDS. Whilst surveys show a levelling-off of HIV prevalence, the rate is still far too high for a small population such as ours. In response to this, Zimbabwe has adopted key interventions recommended by the World Health Organisation’s regional member states, including voluntary counselling and testing services, and comprehensive Prevention of Mother-to-Child-Transmission of HIV services. Our capacity to produce ameliorative drugs for the pandemic continues to grow. 

To protect vulnerable children against the adverse economic effects, 239 656 children had their school fees, in excess of $1,7 billion, paid for under the Basic Education Assistance Module (BEAM). Despite the seeming increase in the resources allocated this year, the number of children assisted regrettably decreased, owing to the general increase in fees, levies and operational costs. 

Mr. Speaker, we are grateful for the overwhelming support our cause continues to receive from the international community. Following the recent defeat of the British-sponsored country-specific motion against Zimbabwe at the United Nations General Assembly, our country continues to make its case to fair-minded sections of the international community which, thankfully, are in the majority. We seek no enmity from any quarter whatsoever. We only seek friendship with anyone, and any nation, provided, of course, there is unconditional recognition of our sovereign right to determine our own future and destiny. 

Government supports the efforts to strengthen African Union (AU) instruments aimed at preventing and combating terrorism and mercenarism. To this end, Government will work towards the speedy incorporation into legislation of the relevant provisions of the AU Convention for the Elimination of Mercenarism in Africa. 

Mr Speaker, international and regional gatherings, the most recent ones being the AU and SADC Summits, as well as the 59th Session of the UN General Assembly, give Government the additional opportunity to draw the world’s attention to prevailing socio-economic and political developments which include the hostile machinations of our detractors. 

In this regard, Government will continue to condemn the illegal acts of aggression perpetrated by some powerful nations against smaller states in blatant violation of the norms of international law as enshrined in the UN Charter. This behaviour has rendered the UN Security Council impotent. Government thus fully supports the on-going measures towards the reform of the United Nations system, in particular, the revitalisation of the General Assembly and the democratisation of the Security Council. 

Finally, as we look forward to the year 2005, let us do so with greater commitment and preparedness to work together to build on the socio-economic gains achieved to date. We are one Nation with one economy and, no doubt, working together, we can make Zimbabwe great! 

Finally, may I wish you all a Happy Christmas and Prosperous New Year.

 I thank you!